British American Tobacco is investing another 6.35 million Canadian dollars ($5.1 million) in Organigram, increasing its stake in the Atlantic Canada-based cannabis producer to 19.5%, the companies announced.
Last year, British American Tobacco (BAT) sealed a strategic collaboration with Organigram via a CA$220 million investment. The partnership has a focus on research and product development.
BAT said it increased its investment by purchasing 2,659,716 Organigram common shares at an average price of CA$2.39, for gross proceeds of CA$6.35 million.
“Innovation is an important cornerstone of Organigram’s core strategy and the Product Development Collaboration with BAT underscores our commitment to the development of disruptive, consumer-focused cannabis products,” Organigram CEO Beena Goldenberg said in a statement.
“We are pleased with the successful launch of the PDC and the progress we are making so far.”
The move bolsters Organigram’s cash position of CA$168 million.
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Cash has become increasingly important in the Canadian cannabis industry, as capital is much harder to come by compared to previous years, when investors indiscriminately funded cannabis companies.